Scottish firm at centre of global corruption scandal

Scottish firm at centre of global corruption scandal involving family of Uzbekistan President Islam Karimov

Uzbek President Islam Karimov

SCOTLAND is at the centre of a major corruption scandal involving the family of a leader in a former Soviet republic.

A firm in Fife called the Brook Organisation has been named as part of an investigation into an £8 million turf war between the nephew of Uzbekistan’s authoritarian president Islam Karimov and a business rival.

The dispute involves two five-star hotels in Riga, Latvia, and has been allegedly linked to a series of gangland crimes, including a foiled assassination attempt, according to reporters in the Baltic state.

The hotels are said to be controlled by the Brook Organisation, which is registered in Rosyth.

News of the Baltic investigation reaches Scotland just as Prime Minister David Cameron launches his own crusade against global corruption despite international concerns that Britain’s softly regulated legal and financial system is being exploited to facilitate mass money-laundering.

Due to a legal loophole that makes Scotland vulnerable to money-launderers, the country is often advertised in Eastern Europe as a tax haven.

It also comes amid growing concern about Scotland’s ‘limited partnerships’, such as the Brook Organisation, which do not need to file financial accounts or register for taxation purposes thanks to a century-old quirk in Scottish company law.

Picture: President Islam Karimov

Last year, millionaire Ilan Shor was accused of using firms registered at modest addresses in Edinburgh and Inverness to carry out a $1bn swindle in impoverished Moldova.

They outlined a power struggle for control of the Brook Organisation limited partnership and the two hotels it controlled, Riga’s £8m Royal Square Hotel and Hotel Garden Palace.

And they named the two parties to the dispute as Akbar Abdullayev, the playboy nephew of President Karimov, and an Afghan-Latvian businessman called Gulam Gulami.

Pictured: Akbar Abdullayev

Picture courtesy of Re:Baltica

The case, they said, was “reminiscent of early-1990s-style eastern European capitalism” and that it had shone “a light on the darker corners of the Latvian legal system”.

Thirty-three-year-old Mr Abdullayev - whose name can also be spelled Abdullaev - is understood to have fallen out of favour with his uncle and is currently in prison having been accused of embezzling from state-owned farms.

Mr Abdullayev had been touted as a possible successor to President Karimov, who is married to his aunt.

He once enjoyed a luxury lifestyle in Riga, owning a £160,000 Bentley that was one of the most expensive cars registered in the country.

Mr Abdullayev and businessman Gulam Gulami have struggled for control of the hotels for years.

A case came before Scotland's Court of Session in January 2014 over registration of the Brook Organisation.

Lord Woolman granted suspension of a form submitted in relation to the Brook Organisation that was sought by Mr Gulami.

The firm is registered alongside at least 64 other businesses at a semi-detached former council house in Rosyth.

It is now owned in the Seychelles. Previously the partners in the firm, its owners, had been located in Belize.

Mr Gulami, meanwhile, has problems of his own. He has been charged with bribing a judge and has been named by reporters at Re:Baltica as the only suspect in a larceny case under consideration by prosecutors in respect of the two hotels.

The latest events come five years after one of Mr Abdullayev’s former business associates in Latvia became the victim of a botched gangland hit. A man was later jailed for nearly 11 years for attempted murder.

Mr Gulami denies all the allegations of bribery and larceny. He is understood to have claimed to have given Mr Abdullayev some $12m, which the Uzbek spent on cars, clothes and entertainment. He did so, he told prosecutors, at the behest of Mr Abdullayev’s cousin, President Karimov’s youngest daughter, Lola Karimova.

The Herald understands that Latvian law enforcement agencies have been in touch with their Scottish counterparts over the Riga hotel case.

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